ACC 307 WK 5 Midterm Exam Chapter 6

CHAPTER 6Student: ___________________________________________________________________________1.A taxpayer who claims the standard deduction cannot also deduct expenses that are classified as deductions from AGI.TrueFalse2.Mitch is in the 28% tax bracket. He may receive a different tax benefit for a $2,000 expenditure that is classified as a deduction from AGI than he will receive for a $1,000 expenditure that is classified as a deduction for AGI.TrueFalse3.Depending on the nature of the expenditure, expenses incurred in a trade or business may be deductible for or from AGI.TrueFalse4.All employment related expenses are classified as deductions for AGI.TrueFalse5.The only 212 expenses that are deductions for AGI are those related to rent and royalty income.TrueFalse6.Alice incurs qualified moving expenses of $12,000. If she is reimbursed by her employer, the deduction is classified as a deduction for AGI. If not reimbursed, the deduction is classified as an itemized deduction.TrueFalse7.Expenses incurred for the production or collection of income generally are deductions from adjusted gross income.TrueFalse8.The Code defines what constitutes a trade or business.TrueFalse9.For an expense to be deducted as ordinary, it must be recurring in nature.TrueFalse10.Amos, a shareholder-employee of Pigeon, Inc., receives a $